Vice-Speaker B.J. Cruz has introduced a bill to lower GovGuam’s debt ceiling. The bill would lower the maximum amount of money GovGuam can borrow.
Guam – Vice-Speaker B.J. Cruz has introduced a bill to lower the debt ceiling or lower the maximum amount that the Government of Guam can borrow.
Now that GovGuam has completed a property tax revaluation for the entire island the amount of money that GovGuam can borrow has increased. “It’s increasing the debt ceiling by about $497 million dollars. I thought maybe I should introduce a bill to lower the debt ceiling so we don’t have to borrow all that,” said Cruz. The Vice-Speaker has introduced Bill 205 to reduce GovGuam’s debt ceiling by $400 million. “We’re obviously having some financial troubles right now. The hospital is in major dire straights not being able to pay their retirement and also they haven’t been paying their FICA their withholding to Rev&Tax so GDOE has $9 million that’s outstanding in vendor payments they haven’t paid off GCC UOG and DOE $20 million dollars from last year’s appropriation. We’re short cash we cannot afford to increase our debts,” said the Vice-Speaker.
The debt ceiling has increased numerous times in order to allow GovGuam to borrow more money on the bond market. In fact the last time it was raised it was raised to 100 percent of the island’s property tax value in order to borrow money for tax refunds. The Vice-Speaker’s bill would lower this back down to 77 percent.
“We can not continue to borrow more money and so this is an attempt to say yes we may be worth more on paper but let’s not borrow to the max lets try to be reasonable and stay below 77 percent,” said the Vice-Speaker.
Cruz says that his bill will not affect the current bonds that GovGuam is paying and he says it will not raise the amount people are paying for property taxes.